CKS Limited is a listed nationalised bank whose face value per share is 100 each having its operation across India. CKS Limited appointed Mr. Mir,…

CKS Limited is a listed nationalised bank whose face value per share is 100 each having its operation across India. CKS Limited appointed Mr. Mir, Mr. Bir and Mr. Dir as its central joint auditors for the year 2024-25. After making sure that all of them are qualified to be appointed as statutory auditors of the bank, CKS Limited issued appointment letter as well as engagement letter to all of them. The engagement letter contains the details on objective and scope of audit, responsibilities of auditor, management and identification of framework applicable. It also contains the reference to expected form and content of report from all three joint auditors. During the year, CKS Limited has acquired another bank called Royal Limited. While finalising the books of accounts, some adjustments were made to give the effect of merger. These adjustments were related to determination of goodwill of 2.5 crore, determination of amount of minority interest of 60 lakh and some intra-group transaction adjustment of 17 lakh were also made. Another adjustment which was made was harmonization of accounting policies of both CKS Limited and Royal Limited which was of 34 lakh. While planning the audit, all joint auditors mutually decided that responsibility of verification of cash book will be entrusted with Mr. Bir. But Mr. Bir failed to detect the fraud committed by the cashier which he could have detected if he had properly checked the cash book. This fraud was revealed in the special audit which was conducted on the directions of RBI. Responsibility for verifying compliance with SLR requirement was entrusted with Mr. Mir. While performing audit on compliance with SLR requirements Mr. Mir used 12 odd dates in different months of financial year. Mr. Mir with his professional judgement used the below mentioned days: Month Day of month Day April 5 th Friday May 12 th Sunday June 6 th Thursday July 27 th Saturday August 20 th Tuesday September 6 th Friday October 28 th Monday November 12 th Tuesday December 5 th Thursday January 12 th Sunday February 21 st Friday March 2 nd Sunday Mr. Dir was entrusted with responsibility for calculation of Demand and time liability. On 31 st March 2025, total liability stood at 250 crore. It includes Margin held for funded facilities of 3.5 crore, credit balance for one branch of 4.5 crore, adverse balance of Nostro Mirror Account of 2.3 crore and unadjusted deposit for agency business of 7.5 crore. Wife of CA Mir was also a Chartered Accountant and was actively involved in purchase and sale of shares. She purchased 100 shares of CKS Limited of 100 each for 19,50,000. All the required communication were made among the joint auditors, and significant matters were discussed with those charged with governance. At the end, an unmodified report in accordance with SA 700 was issued, which was signed by all three joint auditors.